Former Va. delegate Villanueva pleads guilty to defrauding US government

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NORFOLK, Va. (WAVY) — A former Virginia delegate accused of defrauding the federal government has pleaded guilty. 

Ron Villanueva was indicted on multiple charges in January, including conspiracy to defraud the United States, falsification of records and aiding and abetting false written statements.  

The charges followed a federal investigation into how Villanueva pursued government contracts for minority-owned businesses. 

A 22-page indictment alleged Villanueva misled the Small Business Administration and that he and others benefited from millions of dollars in contracts that were awarded fraudulently.

Investigators say he participated in a nine-year conspiracy involving more than $80 million in fradulently obtained government contracts. Villanueva received more than $1 million in income from the companies.

Villanueva conspired with two other people to help two Virginia Beach companies get contracts from the Small Business Administation. 

The companies are SEK Solutions and Karda Systems. Villanueva began working for SEK Solutions in 2005. When that company’s 8(a) status was set to expire in 2010, Villanueva and his co-conspirators set up Karda Systems. On paper, it was run by Villanueva’s brother-in-law, however the business was managed by Villanueva and other people associated with SEK Solutions. 

As part of the conspiracy, prosecutors say Villanueva misrepresented whether the two companies were eligible for government contracts under the SBA’s 8(a) program, which sets aside contracts for minority-owned businesses. Neither company was eligible to participate in the program. Prosecutors say Villanueva and his co-conspirators made numerous false statements and certifications to the contrary. 

During some of that time, Villanueva was a member of the Virginia General Assembly. He’s accused of using his House of Delegates letterhead to send a letter to the SBA supporting Karda’s application to participate in the 8(a) program, knowing there was false and misleading information in the letter. Villanueva pleaded guilty to conspiracy to defraud the U.S. government — a plea which the judge accepted.

Villanueva’s guilty plea comes after he pleaded not guilty to the charges during an arraignment in mid-January. 

His defense attorney says the charges of falsifying records and helping others file false documents will be dismissed at the sentencing hearing.

“The government’s agreed to move to dismiss the charges,” said attorney Thomas Bondurant. “It won’t officially be done until the sentencing hearing.”

Villanueva released a statement today, saying in part that he has “come to a painful intersection” in his life that “runs contrary to everything” he has worked and stood for. He also says he regrets his “poor judgement” and should have “adhered to the law.”

“Ron got involved in the business, he got in a gray area and a gray area became criminal violations,” said Bondurant. “So he found himself caught up in this and he’s accepting responsibility for what he did and he hopes to move forward with his life after this.”

Villanueva also says he “accepts full responsibility” and understands the consequences of his actions.

The prosecution is asking for more than $1 million in restitution. Villanueva could also face up to five years in prison. That will all be determined at his sentencing hearing, which is scheduled for July 2.

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